Spending by Canadian businesses and consumers on wireless voice and data increased faster last year compared to 2009 as four new wireless services entered the market and pushed up the number of subscribers, according to the federal telecommunications commission.

In its annual communications monitoring report, which covers the telecom and broadcasting industries, the Canadian Radio-television and Telecommunications Commission (CRTC) said that in 2010 wireless carrier revenues from all providers hit $18 billion, up 6.6 per cent from 2009, the second year in a row wireless revenues were in single digits.

By comparison, wireless revenue in 2008 was up 10.4 per cent compared to 2007, and previous years the growth rate was even higher.

The number of Canadians subscribing to wireless services grew by 8.5 per cent to 25.8 million by the end of 2010.

The bad news for the industry is that the competitive presence of the new operators contributed to a reduction in the average revenue per user a month to $57.86 from $58.81, the report said.

Despite the increased competition, last year was the second consecutive year that wireless revenue growth was in single digits compared to the go-go years earlier in the decade.

Last year startups Mobilicity and Public Mobile joined Wind Mobile (which began operating the last two weeks of 2009) in hunting for new wireless customers. Also in 2010 Quebecor Media Inc.’s cable division, Videotron, which had been selling wireless using leased spectrum from Rogers Communications Inc., opened a new network using its own spectrum. In 2010 only Wind operated for the full year.

According to the report, the new entrants collected 25 per cent of new wireless subscribers last year.

At a time when mobile penetration was below 70 per cent, much lower than in the U.S. and other industrial nations, the government decided to set aside frequencies in the 2008 spectrum auction strictly for new entrants or existing carriers with small market share.

The report also shows that the new entrants have captured two per cent of wireless subscribers, meaning Rogers, Bell and Telus have 93 per cent of the market.

The province where new entrants have made the biggest entry is Quebec, where they have three per cent of subscribers. It is believed the bulk of that is held by Videotron.

The report also shows that Bell suffered the most monthly churn last year – the number of subscribers who left for another carrier – at 1.9 per cent, compared to 1.6 per cent at Telus and 1.5 per cent at Rogers.

Telecommunication revenues increased by 1.8 per cent over 2009, growing to $41.7 billion from $41 billion. Of that, competitors of established companies accounted for $18.8 billion, or 45 per cent, of total revenues in 2010.

In 2010, telecommunications companies allocated $8.4 billion for capital expenditures, a slight increase from the $8 billion spent in 2009.

As for Internet penetration, the report says 77 per cent of the 13.4 million households in Canada had an Internet subscription. The percentage of households with an Internet connection with download speeds of at least 1.5 megabits per second (Mbps) jumped from 62 per cent to 70 per cent in one year. Additionally, subscriptions to Internet download speeds of at least 5 Mbps rose from 44 per cent to 52 per cent.

Using data from Akamai Technologies, which makes a Web distribution platform used by major content providers, the commission concluded that in the fourth quarter of 2010 Canadian Internet providers offered an average download speed of 5.5 Mbps, second only to Japan (with 8.3 Mbps and 5.1 Mbps in the U.S.) among eight countries compared.

The report doesn’t say so, but the increase likely reflects the faster speeds offered by cable companies using DOCSIS 3.0 technologies and the spread by Bell, Bell Aliant and Telus of high speed fibre optic lines to homes.

During 2010, the average residential broadband user downloaded 14.8 gigabytes per month, the CRTC said, adding that is the equivalent of viewing more than 20 movies.

Currently a freelance writer, I'm the former editor of ITWorldCanada.com and Computing Canada. An IT journalist since 1997, I've written for several of ITWC's sister publications including ITBusiness.ca and Computer Dealer News. Before that I was a staff reporter at the Calgary Herald and the Brampton (Ont.) Daily Times.